BARCLAYS Q3 2019 RESULTS

Group performance

  • Profit before tax was £3,260m (Q318 YTD: £3,120m), including an additional provision for PPI of £1,400m (Q318 YTD: £400m) in Q319. Excluding litigation and conduct, profit before tax was £4,942m (Q318 YTD: £5,267m), with higher income and stable operating expenses offset by increased credit impairment charges. The 6% appreciation of average USD against GBP positively impacted income and profits and adversely impacted credit impairment charges and operating expenses
  • Total income increased 2% to £16,331m. Barclays UK income decreased 2% as ongoing margin pressure and continued reduced risk appetite in UK cards were partially offset by mortgage and deposit balance growth. Barclays International income was up 4%, across both CIB and CC&P. The higher CIB income was due to positive performance in FICC, Banking fees and Transaction banking, partially offset by reduced client activity in Equities and a reduction in Corporate lending. The higher CC&P income reflected balance growth in US cards and partnership growth in merchant acquiring
  • Credit impairment charges increased to £1,389m (Q318 YTD: £825m). Economic scenarios were updated in Q319, as part of a review which is conducted at least annually. The prior year benefitted from favourable US macroeconomic scenario updates and single name recoveries, whilst Q319 impairment reflects a c.£60m net charge from revised scenarios, impacting primarily the Group’s UK and US cards portfolios. Credit metrics remained stable across both secured and unsecured lending, reflecting the continued prudent management of credit risk
  • Operating expenses were stable at £10,051m, as cost efficiencies were offset by continued investment in the business. The cost: income ratio, excluding litigation and conduct, was stable at 62% (Q318 YTD: 62%)
  • The effective tax rate was 25.0%. Excluding litigation and conduct, the underlying effective tax rate was 17.9%
  • Attributable profit was £1,780m (Q318 YTD: £1,611m). Excluding litigation and conduct, attributable profit was £3,391m (Q318 YTD: £3,685m), generating a RoTE of 9.7% (Q318 YTD: 11.1%) and EPS of 19.7p (Q318 YTD: 21.6p)

Barclays International

  • Profit before tax, excluding litigation and conduct, decreased 4% to £3,508m with a RoTE of 10.4% (Q318 YTD: 11.6%), reflecting returns in the CIB of 9.3% (Q318 YTD: 9.7%) and CC&P of 15.8% (Q318 YTD: 21.7%)
  • The 6% appreciation of average USD against GBP positively impacted income and profits, and adversely impacted credit impairment charges and operating expenses
  • Total income increased to £11,223m (Q318 YTD: £10,805m)
  • CIB income increased 4% to £7,917m
  • Within Markets, FICC income increased 15% to £2,638m reflecting a strong performance in rates and growth in securitised products. Equities income decreased 11% to £1,478m driven by equity derivatives, which were impacted by reduced client activity. Included in Markets was a £126m gain related to the Tradeweb position and a net loss of £40m due to the impact of treasury operations and hedging counterparty risk
  • Banking fees income increased 3% to £1,955m driven by an increase in advisory fees, partially offset by lower debt underwriting fees reflecting a reduced Banking fee pool1 . However, Barclays share of the global Banking fee pool has increased since FY18, to 4.4%1
  • Within Corporate, Transaction banking income increased 6% to £1,283m reflecting growth in deposits. This was offset by a decrease in Corporate lending income to £563m (Q318 YTD: £635m). Excluding mark-to-market movements on loan hedges, Corporate lending income was broadly stable
  • CC&P income increased 4% to £3,306m reflecting balance growth in the US cards business and partnership growth in merchant acquiring
  • Credit impairment charges increased to £844m (Q318 YTD: £304m)
  • CIB credit impairment charges increased to £127m (Q318 YTD: release of £185m) due to the non-recurrence of favourable macroeconomic scenario updates and single name recoveries in Q318 YTD
  • CC&P credit impairment charges increased to £717m (Q318 YTD: £489m) due to the non-recurrence of favourable US macroeconomic scenario updates in Q318 YTD. Q319 included the impact of macroeconomic scenario updates, predominantly in the US, of c.£30m. Credit metrics decreased, with US cards 30 and 90 day arrears of 2.6% (Q318: 2.7%) and 1.3% (Q318: 1.4%) respectively
  • Operating expenses increased 1% to £6,923m
  • CIB operating expenses decreased 1% to £5,191m as cost efficiencies were partially offset by continued investment in the business
  • CC&P operating expenses increased 7% to £1,732m driven by continued investment across the businesses
  • RWAs increased to £223.1bn (December 2018: £210.7bn), driven by an increase in CIB activity and appreciation of USD against GBP

BARCLAYS BANK PLC

Barclays Bank PLC offers premier investment banking products and services to its clients through Barclays Bank PLC. Barclays Bank PLC is authorised by the prudential regulation authority and regulated by the financial Conduct

Authority and the prudential regulation authority and is a member of the london stock exchange. Barclays Bank PLC is registered in england no. 1026167 with its registered office at 1 Churchill place, london e14 5hp.